Going VAT registered (UK) - Making ALL goods Taxable

[zefeena]

Hi,

 

I have reached a point where I need to be vat registered.

 

All the goods on my website are currently set as non-taxable.  I guess that was an error, as I should have set them as taxable but with tax at 0%, but I didn't!

 

Is there a quick way to change ALL the goods to taxable, and can anyone point me to a place where I can find the correct info (for the UK), so that I can set up tax zones for other countries.

 

Quite honestly, I don't really get the whole VAT thing with regard to other countries.  I apparently do not charge VAT on export to Austrailia, USA, etc,  but do I charge it on EU countries and if so, is it the UK vat rate or the countries vat rate? and if I am selling  to another person who is VAT registered and gives me their VAT number does that mean I do or do not charge them VAT?

 

It seems so complicated.

 

Kellie

[Mort-lemur]

@@zefeena easiest way would be to run an SQL command - to make them all taxable - Im sure someone will provide one pretty soon.....

 

I dont know what you sell but are all your products subject to Vat? eg childrens clothing, books, etc are not subject to Vat

 

Dont forget to add Vat to your shipping costs as well.

 

Charge 0% vat outside europe

Charge 20% Vat to europe unless they give you a valid Vat nmber (up to you to ensure its valid)

Charge 0% vat to The channel islands

 

OSC does not handle this easily - I usually end up manually editing an order on behalf of the customer to get the Vat levels correct.

 

You will have 2 returns to do - probably 3 monthly standard vat return, then an EU export / import return.

 

I Hate VAT...................

[piernas]

EU VAT is a bit more complex, but in general you should charge VAT to all final customers inside EU. You will charge UK VAT defined for each article.

 

You don't charge VAT to EU registered VAT customers or customers outside EU. There are also some EU zones with special VAT rules. I reccommend you to read all the laws.

[zefeena]

Thank you.  Hopefully someone will get that SQL command to me!

 

I don't sell anything that is vat exempt unfortunately.  I am just going to work very hard and pay the accountant to do all the paperwork, I just need to make sure I can give him the info he needs. 

 

Heather, are there any add-ons that you use for reports or anything that would help me?  I noticed that the shipping doesn't show vat, though currently much of the time I use Royal Mail, which as far as I know doesn't have vat.

 

I am not looking forward to it, but hey ho!

[piernas]

Try this:

UPDATE products SET `products_tax_class_id` =2

where '2' is the number of the tax class you've previously created in admin.

 

Remember to make a copy of your database before testing...

[Mort-lemur]

@@zefeena regardless of whether royal mail charges Vat - when you are vat registered you will be offering delivery as a service, thus you must charge vat on your postage costs

 

Just cooking at the moment - I will post a couple of sql commands I use for preparing my vat retuns later

[Mort-lemur]

@@zefeena ok each time I prepare a Vat return I need to know some stuff from the database, so I use the following Sql commands and export the results as csv files.

 

Firstly the Gross sales within a 3 month period. In the sql set the start and end date and set the orders status numbers to match what you want to account for, in my case these correspond to delivered, in pack, approved, etc

SELECT  o.orders_id, o.date_purchased, ot.title, ot.value, ot.class, o.orders_status
FROM orders AS o
INNER JOIN orders_total AS ot ON o.orders_id = ot.orders_id
WHERE o.date_purchased BETWEEN '2015-01-01 00:00:00' AND '2015-03-20 23:59:59'
AND (o.orders_status = '3' OR o.orders_status = '2' OR o.orders_status = '6' OR o.orders_status = '7' OR o.orders_status = '9' OR o.orders_status = '16')
AND ot.class = 'ot_total'
group BY o.orders_id

Secondly the amount of vat charged on the orders within a 3 month period. In the sql set the start and end date and set the orders status numbers to match what you want to account for, in my case these correspond to delivered, in pack, approved, etc

SELECT  o.orders_id, o.date_purchased, ot.title, ot.value, ot.class, o.orders_status
FROM orders AS o
INNER JOIN orders_total AS ot ON o.orders_id = ot.orders_id
WHERE o.date_purchased BETWEEN '2015-01-01 00:00:00' AND '2015-03-20 23:59:59'
AND (o.orders_status = '3' OR o.orders_status = '2' OR o.orders_status = '6' OR o.orders_status = '7' OR o.orders_status = '9' OR o.orders_status = '16')
AND ot.class = 'ot_tax'
group BY o.orders_id

Then with a bit of cutting and pasting between the two you end up with one spreadsheet giving, by order id, the total gross sales and vat charged in a specific period which you (or your accountant) can use.

 

Another useful sql is the following - which lists by order id the actual products sold within a given period

SELECT  o.orders_id, o.date_purchased, op.products_name, sum(op.products_quantity * p.products_cost)
FROM orders  AS o, orders_products AS op, products AS p
WHERE o.orders_id = op.orders_id
and o.date_purchased BETWEEN '2014-10-01 00:00:00' AND '2014-12-31 23:59:59'
AND (o.orders_status = '3' OR o.orders_status = '2' OR
o.orders_status = '6' OR o.orders_status = '7' OR
o.orders_status = '9' OR o.orders_status = '16')
AND op.products_id = p.products_id
group BY o.orders_id, op.products_name

If I were clever enough with php I would look to build this into a reporting function via admin, but its no big task to do it through phpmyadmin.

 

Hope that helps

[zefeena]

oh God, all that looks awful!  I think I might just go back to bed.

 

I have just filled a VAT registration thingy!  Apparently they have a couple of 'schemes'.  To be honest I wasn't really too sure what I was signing up for, but it seems I can pay a flat 7.5% vat on all my turnover  ((I would not then claim vat back on purchases),   I'm not sure how that works with foreign customers.  also those that are vat registered, as they would not be charged vat by me, yet i'd still be paying it!  - I think it may be a swings and roundabouts type of situation (win some, lose some!)

 

Also I can do an annual VAT return provided I pay them so much a month/quarter in advance so they know I won't skip the country before the end of the year!

 

This seems a simple way, though it appears you need to be under the £150,000 threshold, but that should be okay for a year or two!

 

I'm setting up a new paypal account and new bank account, so I hope that way I can just look at the total of incoming and calculate vat that way.  i.e incoming x 7.5% = outgoing vat to tax man!

 

Might reduce my accountants fees that way!

[Mort-lemur]

@@zefeena

 

So under the 7.5% scheme that would mean that you bought materials for say £20 + Vat (£24)

 

You then sold it for say £30 + Vat (£36)

 

You pay the Vat @ 7.5% = £2.70

 

If you pay the "real" vat and are able to reclaim vat on purchases

 

you bought materials for say £20 + Vat (£24)

 

You pay the Vat @ 20% = £6.00, but you reclaim the £4.00 vat on materials

 

meaning the vat you actually pay is £2.00 - a saving on this one item of £0.70

[zefeena]

Hi,

 

Yes, I agree, it may look better to pay the 'proper' vat, but I get a lot of stuff off someone who is not vat registered, and their price is very good, so the mark up excellent!  I have several suppliers who are vat registered but they are much dearer (even before they add the vat on!), so even if I got to claim 20% vat back it doesn't work out as well to buy from them. 

 

I also have a range of patterns which I have designed myself, so I am not actually purchasing them.   So again only paying 7.5% vat rather than 20% is a definite bonus.

 

Also I think i'd have to use an accountant, if I do proper vat, whereas simply multiplying my turnover by 7.5% is very doable!

[zefeena]

Try this:

UPDATE products SET `products_tax_class_id` =2

where '2' is the number of the tax class you've previously created in admin.

 

Remember to make a copy of your database before testing...

 

Hi,  thank you, that worked well. 

 

Now apparently I cannot charge vat until I get my vat number, so currently I am going to set my vat to 0% so as not to break any rules, however I still have to pay va on those sales!

 

Do you have an equally simple code that works to put the price up of everything by a percentage, and  also maybe another bit that reduces everything should I wish to do that  (not something that the customer sees as a price increase/reduction though)

 

Thank you

[Mort-lemur]

@@zefeena http://www.oscommerce.com/forums/topic/389955-useful-snippets-of-code/page-2 post 36 and 37

 

Remember to back up your database before running any sqls against it - just in case

[Bob Terveuren]

Hi

 

I'd recommend an accountant - we saved more than he cost each year we were VAT registered and that's even with my other half being a really good bookeeper.

 

On changing prices shopwide - backup the products table (always wise if I've suggested anything) and then do something like

 

for 50% hike

 

UPDATE `products` SET `products_price` = `products_price` * 1.5

 

or easier to visualise

 

UPDATE `products` SET `products_price` = `products_price` + ( `products_price` *50 /100 )

 

you can change the plus to a minus and the 50 to any percentage that you like

 

or have a look at http://addons.oscommerce.com/info/4663

[zefeena]

Hi

 

I'd recommend an accountant - we saved more than he cost each year we were VAT registered and that's even with my other half being a really good bookeeper.

 

On changing prices shopwide - backup the products table (always wise if I've suggested anything) and then do something like

 

for 50% hike

 

UPDATE `products` SET `products_price` = `products_price` * 1.5

 

or easier to visualise

 

UPDATE `products` SET `products_price` = `products_price` + ( `products_price` *50 /100 )

 

you can change the plus to a minus and the 50 to any percentage that you like

 

or have a look at http://addons.oscommerce.com/info/4663

 

Thanks Bob, i'll give that a go.  Thank you for that. I thought I could bridge the gap a little so everyone doesn't get a big shock when the vat goes on, as it is quite a jump. 

 

As for the accountant.  Yes, I am absolutely going to use one, I just figure that the more simple the calcs the cheaper he'll be!  I intend to do all the book keeping as neatly and concisely as I can, but then ensure he checks them over and does my tax return and end of year accounts - so I know they are right! , and as often people have told me, a good accountant will save you more than you pay them!